New Economic Geography Meets Comecon

23 Pages Posted: 3 Apr 2019

See all articles by Marius Brülhart

Marius Brülhart

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne)

Pamina Koenig

Paris School of Economics (PSE)

Date Written: April 2006

Abstract

We analyse the internal spatial wage and employment structures of the Czech Republic, Hungary, Poland, Slovakia and Slovenia, using regional data for 1996–2000. A new economic geography model predicts wage gradients and specialization patterns that are smoothly related to the regions’ relative market access. As an alternative, we formulate a ‘Comecon hypothesis’, according to which wages and sectoral location are not systematically related to market access except for discrete concentrations in capital regions. Estimations support both the NEG (new economic geography) prediction and the Comecon hypothesis. However, when we compare internal wage and employment gradients of the five new member states with those of Western European countries, we find that the former are marked by significantly stronger discrete concentrations of wages and service employment in their capital regions, confirming the ongoing relevance of the Comecon hypothesis.

Keywords: EU regions, market access, new economic geography, Comecon hypothesis

JEL Classification: R12, F15, P25

Suggested Citation

Brulhart, Marius and Koenig, Pamina, New Economic Geography Meets Comecon (April 2006). Economics of Transition, Vol. 14, Issue 2, pp. 245-267, 2006, Available at SSRN: https://ssrn.com/abstract=3364513 or http://dx.doi.org/10.1111/j.1468-0351.2006.00256.x

Marius Brulhart (Contact Author)

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne) ( email )

Unil Dorigny, Batiment Internef
Lausanne, 1015
Switzerland
+41 21 692 3471 (Phone)
+41 21 692 3365 (Fax)

HOME PAGE: http://www.hec.unil.ch/mbrulhar/

Pamina Koenig

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France

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